During pre-independence times, when freedom fighters asked Indians to give their household gold, millions came forward to fund the freedom struggle. After all it was the love of their motherland India which made them do so. Recently, when Finance Minister asked the country to stop buying gold, to help rein in the current account deficit, no one took notice and we continued to buy gold, read this.
But even when consumers refuse to let go of their love for gold, corporate Indian is doing its little bit to ensure that you can’t buy gold that easily.
According to a report published in The Economic Times today, financial service companies are taking several steps to help curb gold imports. HDFC bank sent a notification to its branches to stop accepting credit card to purchase gold. They also informed jewellers to stop providing easy EMI facility to consumers for gold purchase. Of course jewelers are not too happy that the easy EMI scheme on credit card has been discontinued. Reason being the scheme was popular with the youth.
State Bank of India in fact went one step ahead and discontinued selling gold coins on a wholesale basis. The report also notes that other banks like Union Bank of India too, are going slow on gold sales. Just last week Reliance Capital stopped selling gold backed funds. Read the full ET report here.
Firstpost take: We think it's all right to buy gold as long as it's for personal consumption or does not exceed more than 5 -10 percent of your investment portfolio. Buying gold in paper for (gold ETF) is better than buying physical gold. You don’t need to break your head over purity since it is not physical gold, also there are no making charges, and it has good liquidity, since it can be sold easily. Read more here.